Department of Small Business Strategic Plan 2014-19.

Department of Small Business

Strategic Plan 2014-19

• Primary Policy Instruments• Mandate• Vision• Mission• Strategic Objectives• Five-year strategic plan• MTEF 2015 – 2018• Budget

• The National Development Plan provides the framework for achieving radical economic transformation

• It sets a vision for the economy that is inclusive, equitable and fast growing.

• To achieve that end, it points to the need to grow employment, support productivity and efficiency gains and move toward greater equality.

• To reach these aims it proposes: – more affordable and efficient infrastructure provision linked to

higher levels of public investment; – substantial improvements in basic and post-secondary

education; – responsive and efficient regulations; and – appropriate sector strategies.

• The key operational plans for implementing the National Development Plan and MTSF include :

• the New Growth Path and the Industrial Policy Action Plan (IPAP).

• The challenge is to ensure that these strategic plans are translated into action plans with well-defined annual iterations

• Through IPAP , plans will focus on productive sectors including mining , agriculture and manufacturing

• Medium Term Strategic Framework : a government strategic plan for 2014-2019 electoral term

• Reflection of the commitments entailed in the manifesto including commitment to implement the NDP

• Sets out identified targets and provides for coherence amongst national , provincial and local government

• Overarching theme : radical socio-economic transformation and service delivery

• Outcome 4 Decent Employment through inclusive economic growth

• Sub outcome 2: Elimination of unnecessary regulatory burdens and lower price increases for key inputs

• Measures to reduce red tape around authorisation for investment in metros ( dti and SBD)

• Enhance township economies by DFIs ( supported by EDD)• Enhanced support for township economies through

improved transport and commuter costs ( SBD supported by COGTA, PICC, DOT DHS)

• Coaching and incubation programmes in support of SMMEs and COOPS( supported by EDD, DAFF and the dti )

• Programmes to ensure increased access to employment and entrepreneurship for black women and youth ( advancing support for emerging and smaller enterprise)

• Develop appropriate sanctions with regard to non compliance in relation to the 30 Day payment period

• )

The department will lead an integrated approach to the promotion and development of small businesses and cooperatives through a focus on the economic and legislative drivers that stimulate entrepreneurship to contribute to radical economic transformation. This drive will foster increased employment, poverty reduction and reduced inequality.

A radically transformed economy through effective development and increased participation of SMMEs and cooperatives in the mainstream economy.

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To create a conducive environment for the development and growth of small businesses and cooperatives through the provision of enhanced financial and non-financial support services, competitiveness, market access, promotion of entrepreneurship, advancing localisation and leveraging on public and private procurement.

•Customer-focused•Integrity•Honesty•Efficiency•Accessibility•Commitment

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1. To facilitate the development and growth of small businesses and co-operatives to contribute to inclusive and shared economic growth and job creation through public and private sector procurement

2. To facilitate radical economic transformation through increased participation of small businesses and cooperatives in the mainstream economy

3. To advocate for a conducive regulatory environment for small businesses and co-operatives to enable access to finance, investment, trade and market access in an equitable and sustainable manner

4. Facilitate partnerships with all spheres of government as well as the private sector to ensure mutual cooperation that will benefit small businesses and co-operatives

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5. To facilitate access to adequate infrastructure and incentives that are designed to attract investment to underdeveloped communities and reduce costs of doing business by small businesses and cooperatives.

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Strategic Objective 1:

To facilitate the development and growth of small businesses and co-operatives to contribute to inclusive and shared economic growth and job creation through public and private sector procurement

Outcome Output Performance Indicator/ Measure

Targets for 2014 - 2019 2014/2015 2015/16 2016/2017 2017/18 2018/19

Increased contribution to GDP, sustainable livelihoods and creation of job opportunities

Implementation of public and private sector procurement programme

Implementation of Sector Catalytic Projects

Increased number of SMMEs and Co-operatives accessing public and private sector procurement opportunities

An increase in the establishment of Co-operatives and Incubators

70 000 SMMEs and Co-ops preferred to access public and private sector procurement opportunities drawn from an economic profiling exercise to be carried out

Linking of 100 co-operatives to market value chains (manufacturing, agro-processing, energy, clothing and textile)

Establishment of 50 Incubators starting from the 2014/15 financial year

National Treasury to issue Practice Notes

Use BBBEEE Codes to mobilise for inclusion of SMMEs and Cooperatives in private sector procurement

5

6

10 000

20

8

15 000

25

10

•20 000

•25

12

25 000

25

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Strategic Objective 1:

To facilitate the development and growth of small businesses and co-operatives to contribute to inclusive and shared economic growth and job creation through public and private sector procurement

Outcome Output Performance Indicator/ Measure

Targets for 2014 - 2019 2014/2015 2015/16 2016/2017 2017/18 2018/19

Increased contribution to GDP, sustainable livelihoods and creation of job opportunities

Implementation of Sector Catalytic Projects

An increase in the establishment of Co-operatives and Incubators

Establishment of 50 Cooperatives in Renewable Energy, Manufacturing, Services, Mining, Agro-processing, Clothing, footwear, textile and leather, and Biofuels.

0 10 12 13 15

Strategic Objective 1:

To facilitate the development and growth of small businesses and co-operatives to contribute to inclusive and shared economic growth and job creation through public and private sector procurement

Outcome Output Performance Indicator/ Measure

Targets for 2014 - 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased contribution to GDP, sustainable livelihoods and creation of job opportunities

Informal Traders Upliftment Projectimplemented

Co-operatives Development Agency established

An increase in the provision of adequate skills and infrastructure support to informal businesses

A fully operational Agency with dedicated and skilled co-operatives managers

3300 informal business owners selected from each province for training prioritising Presidential Nodes

3234 primary co-operatives receiving funding, training and access to market

45 Secondary Co-operatives funded

300

270

3

600

371

6

700

685

9

800

822

12

900

1086

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Strategic Objective 1:

To facilitate the development and growth of small businesses and co-operatives to contribute to inclusive and shared economic growth and job creation through public and private sector procurement

Outcome Output Performance Indicator/ Measure

Annual Targets for 2014 - 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased contribution to GDP, sustainable livelihoods and creation of job opportunities

Decentralisation of business support services

Youth Black Business supplier Development Programme implemented

Capacity building and co-location for SEDA Branches

Funding of Youth Enterprises

72 SEDA Branches trained

140 co-location points

1500 Youth Enterprises funded

5

10

40

10

25

200

15

30

300

20

35

400

22

40

560

Strategic Objective 2

To facilitate radical economic transformation through increased participation of small businesses and cooperatives in the mainstream economy

Outcome Output Performance Indicator/ Measure

Targets for 2014 - 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased participation of SMMEs and Co-operatives in the mainstream of the economy

Centers for Entrepreneurship established

Enterprise Cadet Scheme

Mass Youth Enterprise Creation Programme

Global Exporter Passport Programme

Signing of MoAs with hosting academic institutions

An increase number of new enterprises established

Increased creation of Youth owned enterprises

Accelerated development of Export ready SMMEs

Centers opened in 20 hosting academic institutions

600 new enterprises established

3000 Youth enterprises launched over a 5-year period

6400 Export ready SMMEs developed to consider opportunities in identified international markets ( market access)

2

2

0

1000

3

60

300

1200

4

118

700

1300

5

200

800

1400

6

220

1200

1500

Strategic Objective 3:

To advocate for a conducive regulatory environment for small businesses and co-operatives to enable access to finance, investment, trade and market access in an equitable and sustainable manner

Outcome Output Performance Indicator/ Measure

Target for 2014 – 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Simplified regulatory environment to promote competitiveness and market access

Amendment of the National Small Business Act, 1996 (No.102 of 1996)

Roll-out of Red tape reduction guidelines championed

Advocate implementation of set-asides programme

Commence the amendment of the Act during the 2014/15 financial year

Government- wide implementation of red tape reduction programme

Government-wide implementation of set-asides programme

The Act aligned to the mandate of the department to remove constrains for SMMEs and Co-operatives development

Red tape reduction guideliness institutionalised at all state institutions

Consideration of administration and legislative processes

Conduct sector specific scoping exercise on regulatory constraints

Issuing of the practice note by National Treasury

Tabling and Implementation of the Act

Obtain Cabinet approval for adoption of guidelines as national and provincial policy

Monitoring of effective implementation of set-asides programme

Implementation and monitoring of compliance

Conduct sector specific scoping exercise on regulatory constraints

Monitoring of effective implementation of set-asides programme

Implementation and monitoring of compliance

Conduct sector specific scoping exercise on regulatory constraints

Monitor and assess implementation of set-asides programme

Implementation and monitoring of compliance

Strategic Objective 3:

To advocate for a conducive regulatory environment for small businesses and co-operatives to enable access to finance, investment, trade and market access in an equitable and sustainable manner

Outcome Output Performance Indicator/ Measure

Target for 2014 – 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Simplified regulatory environment to promote competitiveness and market access

Developmental Cooperatives Model finalised

Developmental Cooperatives Model implemented

Model adopted countrywide and sustainable cooperatives that contribute to economic growth and job creation established

Draft model developed

Model approved, aligned with provinces (capacity building) and implemented

Implementation Monitoring and Evaluation

Monitoring and Evaluation

Strategic Objective 4

Facilitate partnerships with all spheres of government as well as the private sector to ensure mutual cooperation that will benefit small businesses and co-operativesOutcome Output Performance

Indicator/ Measure

Targets for 2014 – 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased participation of role players to support SMMEs and Co-operatives development

Mainstreaming of Youth (including women and people with disability) enterprises through transversal agreements in the following sectors: clothing and textile, agriculture, infrastructure, energy

Export Villages

Signing of transversal agreements between dsbd and all state institutions to facilitate market access

Development of an Export Village Strategyand Implementation Plan

120 000 (youth, women and people with disability) jobs created through the signed transversal agreements

9 Export Villages rolled-out across the country to provide capacity building and market access for SMMEs and cooperatives

0

0

30 000

1

30 000

2

30 000

3

30 000

3

Strategic Objective 4:

Facilitate partnerships with all spheres of government as well as the private sector to ensure mutual cooperation that will benefit small businesses and co-operatives

Outcome Output Performance Indicator/ Measure

Targets for 2014 – 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased participation of role players to support SMMEs and Co-operatives development

National Enterprise Development Fund established

Shared Economic Infrastructure Facility implemented

Forging sustainable partnerships with the private sector to benefit SMMEs and Co-operatives

Accelerated Partnership Agreements with Provincial and Local Government

7000 start-ups and growth oriented SMMEs and Co-operatives that access the Fund

278 Municipalities partnering with the dsbd

Designing criteria for disbursing the funding and lobby the private sector to contribute to the fund

10

1000

30

1500

50

2000

88

2500

100

Strategic Objective 4

Facilitate partnerships with all spheres of government as well as the private sector to ensure mutual cooperation that will benefit small businesses and co-operatives

Outcome Output Performance Indicator/ Measure

Targets for 2014 – 2019 2014/15 2015/16 2016/2017 2017/18 2018/19

Increased participation of role players to support SMMEs and Co-operatives development

Micro Franchising Incentive designed and approved

Accelerated identification and packaging of SMMEs and Co-operatives

110 SMMEs and Co-operatives packaged as micro franchisors

5 20 25 30 30

Short-term PrioritiesShort-term Priorities

• Skills, training and capacity building (LED, business development support, technology transfer, innovation and entrepreneurship).

• Finalise incentives and access to finance delivery model.• Identify opportunities for public sector procurement (set-

asides programme).• Establish business development/marketing section to identify

and develop business plans for implementing public sector procurement opportunities.

• Private sector procurement opportunities (supplier development programmes, revitalisation of mining towns).

• Develop new policies, review existing policies and implement strategies, i.e. roll-out of key interventions.

Long-term PrioritiesLong-term Priorities

• National survey (periodic and reliable statistics)• Design training programmes to address skills gaps

including sector specific interventions• Develop key domestic and international markets • Decentralise business development services to include

economic profiling and market access• Develop and review the regulatory environment

Envisaged ImpactEnvisaged Impact• Incentive programmes aimed at creating new businesses,

which will increase the potential for new jobs• Public and private sector procurement geared towards

improving market access (including growth and development) for black small enterprises and co-operatives (e.g. fixing of potholes)

• Increased culture of entrepreneurship aimed at increasing the number of new innovate and sustainable business ventures that will contribute to job creation

• Creating a simplified policy and regulatory environment for SMMEs and Co-operatives development to eradicate poverty, inequality and unemployment

Envisaged Impact cont…Envisaged Impact cont…

• Through the Export Development Programme companies will improve their ability to export and reduce the costs and risks involved in penetrating foreign markets

• The provision of technical and business development services to the targeted groups (youth, women and people with disabilities) will result in upgraded skills, improved quality of products, access to local and international markets, enhanced and sustainable enterprises, increased employment.

• Enhanced support to informal businesses, rural and township enterprises will increase their competitiveness, resulting in sustainable enterprises and retention of existing jobs.

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EconomicClassification

2015/2016

2016/2017

2017/2018

TOTAL

Compensation of Employees

264 219 281 394 299 688 782 663

Good & Services 123 840 138 224 157 070 441 748

Transfer Payments 1 179 000 1 298 400 1 432 400 3 909 740

Payments for Capital Assets

7 715 8 487 9 335 25 537

TOTAL 1 574 774 1 726 505 1 898 493 5 199 772

• Grants and soft loans will be researched and covered as per the Cluster determination

• The proposal is R2.5 billion over the MTEF period

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Transfer Payments 2015/2016

2016/2017

2017/2018

TOTAL

seda 665 000 731 500 804 650 2 201 150

SAWEN 17 000 18 700 25 570 56 270

Isivande 12 000 13 200 14 520 39 720

Incubation Support Programme

200 000 220 000 242 000 662 000

Cooperatives 200 000 220 000 242 000 662 000

Centre for Entrepreneurship

25 000 29 000 31 000 85 000

CDA 60 000 66 000 72 600 198 600

TOTAL 1 179 000 1 298 400 1 432 340 3 909 740

Programme 1: Administration R534 million

This programme will be comprised of support services to the department in terms of a Chief Information Office, Human Resources, Legal Services, Corporate Governance and Ethics, Auxiliary Services and a unit to execute the marketing and communications of the department.

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Programme 2: Customised Intervention Programmes R371 million (includes Gender, Innovation, IP, IKMS, Youth, NIBUS, People with disabilities)

The key focus will be striving to improve the quality of financial and non-financial support services to SMMEs and coops. Specific programmes will include support of informal activities through the implementation of the National Informal Business Upliftment Strategy (NIBUS), which will provide subsistence for people who are economically marginalised. In addition to this the department on supporting market access initiatives.

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Programme 3: Co-operatives R366 million

The department will be implementing a new support model for cooperatives, including implementation of the Co-operatives Act and the establishment of a Cooperatives Development Agency and Tribunal, and developing and providing financial incentives.

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Programme 4: Research, Policy and Intergovernmental Relations R87 million

Evaluation of existing policies such as National Small Business, Cooperatives, Youth Enterprise Development, Women Empowerment and National Informal strategies with a view to enhance policies in line with the mandate of the Department. The conclusion of transversal agreements with other Government Departments to enhance implementation of Departmental strategies will need to be effected.

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Programme 5: Enterprise Development and Entrepreneurship R3.8 billion (includes Chief Directorates Enterprise Development, Entrepreneurship and Franchising, Skills Development, Supply Development, Impact Assessment, Regional Industrial special projects and Incentives and soft loans to both SMMEs and Co-operatives)

Coaching and incubation programmes will be provided in support of SMME’s and co-operatives and will include support in capturing innovation and managing intellectual property and indigenous knowledge for small businesses.

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• Requested R60 million• Allocated R33.7 million

• R16 million CoE• 12.7 million G&S• R5 million Capital Assets